Business Studies HSC Exam 2017

[bimberfairy]

Sameee I thought the multiple choice was pretty decent and I didn't really have enough time to write the response so I ended up writing only 2 paragraphs/4 pages about supply chain management - global sourcing and outsourcing, link them competitive advantage, touched a bit on performance objectives and mainly how those can lead the business to achieve the roles of cost leadership and product differentiation.

OMG I kinda wrote something similar to you!!! My main paragraphs were about outsourcing and global sourcing haha (: Short answer was such a killer! I felt like every time I flipped the page, new questions kept popping up!

[_____]

Question 17:
The expense ratio (total expenses divided by sales) is always...

So you could be right? What did everyone else think for this one?

Let's try:

Sales: $10000
GP: $5000
COGS: $5000
NP: $3000
Non-COGS expenses: $2000

In this situation,

GPR = 5000/10000 = 0.5:1
NPR = 3000/10000 = 0.3:1
ER = 7000/10000 = 0.7:1

As I understand it expenses means COGS+other expenses (it did say total expenses/sales) so I put D (always higher than net profit). I also used an example with NP = 1 to confirm this. If expenses doesn't include COGS then B is correct.

[bimberfairy]

Couldn’t agree more. For a brief summary of what I would discuss see page one. Other ideas are totally encouraged though! Thanks.

Just read it before and honestly, your points are so interesting haha! Talking about the GFC and the impacts of the global economy upon operations would've been such a good idea and concept to talk about in the essay

[Juliesokha]

OMG I kinda wrote something similar to you!!! My main paragraphs were about outsourcing and global sourcing haha (: Short answer was such a killer! I felt like every time I flipped the page, new questions kept popping up!

YAYYYY!! I hated section 2 so much omg like really ughh

[_____]

Ahh, by extending their working hours, the business creates a strength for itself as it has a competitive advantage over other businesses. And because of creating this strength, it is able to overcome the threat of a new business opening up (I believe that was the scenario in the question? I don't remember it too clearly)

Agreed, it's an internal choice not some external opportunity. So strength/threat.

[aattard]

Yeah I put liquidity too, but damn it if the answer's actually solvency.

This was a tricky question no doubt. I’m open to more ideas.
Liquidity is pay bills in short term.
Solvency is pay bills in short and long term.

But since they used the words “all its debts as they fall due” I was thinking more solvency since all would mean long and short term. Honestly though it’s a tough question. I’m not surprised to see confusion. Any other ideas or viewpoints on this one guys?

[aattard]

Let's try:

Sales: $10000
GP: $5000
COGS: $5000
NP: $3000
Non-COGS expenses: $2000

In this situation,

GPR = 5000/10000 = 0.5:1
NPR = 3000/10000 = 0.3:1
ER = 7000/10000 = 0.7:1

As I understand it expenses means COGS+other expenses (it did say total expenses/sales) so I put D (always higher than net profit). I also used an example with NP = 1 to confirm this. If expenses doesn't include COGS then B is correct.

Loving this answer. Well done. I think you got this!

[Juliesokha]

I got Solvency for that one too because all ITS debts which can include both short and long term debts. Anyway, can you please tell me the answer to the question that was talking about the responsibility of [employees, employers, union, society].... in flexibility, expansion something?

[_____]

I got Solvency for that one too because all ITS debts which can include both short and long term debts. Anyway, can you please tell me the answer to the question that was talking about the responsibility of [employees, employers, union, society].... in flexibility, expansion something?

I agree with solvency, long term debts can "fall due" just like short term debts. The answer to that was employers.

[Juliesokha]

I agree with solvency, long term debts can "fall due" just like short term debts. The answer to that was employers.

thank god omg thank youuu

[Ninjajnin]

Let's try:

Sales: $10000
GP: $5000
COGS: $5000
NP: $3000
Non-COGS expenses: $2000

In this situation,

GPR = 5000/10000 = 0.5:1
NPR = 3000/10000 = 0.3:1
ER = 7000/10000 = 0.7:1

As I understand it expenses means COGS+other expenses (it did say total expenses/sales) so I put D (always higher than net profit). I also used an example with NP = 1 to confirm this. If expenses doesn't include COGS then B is correct.

Hi, I am new here! 
I got A for this question because COGS is not part of expenses in the expense ratio calculation despite saying total expenses- here the total is to cover the different types of expenses like operating expenses.(I'm almost 100% sure), so using your exmaple:
Sales: 10,000
COGS: 5,000
Gross Profit: 5,000
Expenses: 2,000
Net profit: 3,000

Thus, GPR= 50%
NPR=30%
Expense ratio= 20%
So it is evident that the expense ratio is always... A) the difference between the net profit ratio and the gross profit ratio

Another way to think about this is NPR= np/sales = gp-expeness/sales = gp/sales - expenses/sales = GPR - Expense ratio

Any different opinions?

[lakwas7]

Not sure if this has been asked or not, but did anyone else put 15) b) (industry averages). I feel as if comparative ratio analysis doesn't necessarily reflect the efficiency/profitability/liquidity/solvency nearly as well as industry averages (e.g. ratios may be low but if its better than industry average, would it still not be good?)

[Ninjajnin]

Not sure if this has been asked or not, but did anyone else put 15) b) (industry averages). I feel as if comparative ratio analysis doesn't necessarily reflect the efficiency/profitability/liquidity/solvency nearly as well as industry averages (e.g. ratios may be low but if its better than industry average, would it still not be good?)

Yes I also put industry average because the information provided could not allow the guy/girl to calculate any ratios let alone compare them. Also, both businesses were in the same industry meaning industry average would say a lot. But who knows

[james campbell]

Hey mate,

Can you explain why it is solvency? - The question said as they fall due did it not? ..... I thought it would be liquidity (lower than 12 months)

For example joe bloggs may be solvent for his NON- current liabilities but he may not have adequate cash flow to pay his short term debt?

Any explanation would be appreciated

cheers

[John316]

I used Cash flow management for my report instead of global financial will I lose marks for this??? ;___;